Fema related query

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HI...

There is a Company in India which initially pays all the expenses incurred by it and later reimburses it from its parent company in Singapore and a fellow subsidiary in India on a 50:50 basis on some agreement entered with the Companies.

But for the purpose of rent expenses, the Company in India reimburses the entire cost of rent from its parent company on a position taken by the Company that if it reimburses rent from its fellow subsidiary, the assessing officer could seek to consider that the Companay is engaged in real estate business. As FDI is not permitted in the Company carrying on real estate business, the Company has decided to reimburse its total rent from parent company.

My query is "whether Reimbursing the entire amount of rent from its parent company would not amount to real estate business"?

Thanks

Replies (1)

Dear Aksh*ta,

 

Please clarify who is paying the charges in first place and who is reimbursing the same to whom ultimately.

 

Anuj

+91-9810106211

femaquery @ gmail.com

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